Chancellor Rishi Sunak's "new age of optimism" requires business to look beyond their current challenges, with supply chains, costs and recruitment. His budget failed to raise their eyes to those horizons.
On the lengthy business-focussed section of Rishi Sunak's statement, there was a business rates cut , with funds galore - from greening transport to small firm lending, and from investment for export to rocket-launching. There's a risk of wage-led inflation, which can be seen in a rise of more than 10% in pay for truck drivers, helping to explain the 11% increase in builders' merchants Travis Perkins prices in the third quarter, and the most unionised parts of the economy using their leverage to drive up pay.
There are uncertainties around the behavioural changes that have taken place during the pandemic. We still don't know if the huge shift towards working from home is positive or not for productivity. The answer is probably that it can be, in some sectors more than others, and under the right management.
Despite the Treasury's efforts, the OBR estimate is that business investment to 2025 will still be 7.3% below the levels expected before the pandemic. That accounts for nearly a third of the 2% scarring, or lost productive capacity of the economy, as we come out of the pandemic.That gives some of the context for the lukewarm reaction Mr Sunak's budget received from business groups.
There was an acknowledgement from the Chancellor, but mainly to offer his explanation that it is a result of global factors and the stresses and strains of the vigorous post-crisis rebound. But trade with the rest of the world was also hard hit. The lockdown impact obscured much of the impact from new trading arrangements with the European Union. But with infection controls eased, trade recovered, much more strongly with the rest of the world than with the European Union.
The voice of business is also in full cry on net zero. Some may dismiss it as 'greenwash', but if business doesn't invest in the transition required to tackle climate change, government efforts alone won't get close.Thousands of activists and protesters are expected in Glasgow for the climate change summit
Easy to be optimistic when you got asmuch money as rishi.